In the Matter of the Application of Apple Valley Ranchos Water Company (U346W) for Authority to Increase Rates Charged for Water Service by $2,748,100 or 18.56% in 2006, $496,580 or 2.69% in 2007, and $1,075,879 or 5.46% in 2008.

OPINION ADOPTING TEST YEAR 2006 REVENUE REQUIREMENTS
FOR APPLE VALLEY RANCHOS WATER COMPANY

1. Summary

Apple Valley Ranchos Water Company seeks a significant rate increase in 2006 and approval of a method to adjust rates for Escalation Years 2007 and 2008. This decision adopts a test year revenue requirement of $ $16,331,400, an increase of 9.19%, for 2006 and approves the formulaic adjustment method for 2007 and 2008 consistent with the existing water company rate case plan, Decision (D.) 04-06-018. The rate of return for Test Year 2006 is 9.45% including a 10.15% return on equity. In addition, this decision adopts a low-income ratepayer assistance plan consistent with Pub. Util. Code § 739.8, granting a $5/month bill credit to Apple Valley customers who meet income eligibility requirements. (Citations to statute refer to the Public Utilities Code unless otherwise noted.) This proceeding is closed.